Does the term "paid community assets" make sense?

Started by MarshallT • 13 replies • 154 views

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MarshallT
Posts: 407

Posted:

Hi,

I am creating a policy about paid assets (annual parking spots, garden plots, etc.) and was wondering if other communities use that term, or something else.

Thanks

ElleN
Posts: 1,392

Posted:

Are you sure the Declaration, definitions section, does not have a general name for this category of HOA owned real property?

I assume your HOA's/condo's Declaration authorizes the charging of a fee for the exclusive use of these parking spots and garden plots. If so, then out west such a policy is often titled something like, "Rules Pertaining to the Use of Limited Common Areas [or Elements]," with the latter areas defined in the Declaration.

DeanJ
Posts: 1,789

Posted:

My declaration says the board may establish admission fees for common areas. So in your situation you would have a parking and garden admission fee.

But, in your situation, you an offering an exclusive rental of a parking spot or a garden plot, which may violate the other owners right to use the common areas.

KerryL1
Posts: 14,519

Posted:

Are these common areas? This is different than some sort of exclusive use common area (CA)*. Or limited use common areas or elements. Please clarify, Marshall.

How does it work? Basically any resident or any owner can "rent" a parking space or garden plot for a long term? If so, is that different than what your Board can do, Dean?

* In my HOA, which I think is typical in Cali, my exclusive use balcony & parking space are deeded to me. Boards can make rules about them, but they certainly may not rent them out.

CathyA3
Posts: 6,286

Posted:

I agree with Dean. Reserved parking would violate my community's declaration, since it says that all owners are entitled to use the common elements, and no one may interfere with another owner's rights. Our parking restriction says that the pads are first-come, first-served, but residents are required to use their garage and driveway space first. The parking pads are for guests and overflow parking.

Exception: it permissible to reserve a parking space as a reasonable accommodation for a disabled owner. In fact it's probably required. So it's a good idea if there is some available space around the community. If the able bodied folks hog all the parking spaces for their own convenience, you'll be in trouble if someone requests a reasonable accommodation, which is something that can happen without warning.

SheliaH
Posts: 6,967

Posted:

It doesn't matter what other communities do - you don't live there, abd as long as there's a definition for what these are, you can use whatever term you like. Some have asked if youre referring to common areas, and that will also need to be factored in.

That said, why the need for a separate policy? For example, if there are paid parking spaces, why can't you put those policies as a subsection of your parking policy?

If it is not right do not do it; if it is not true do not say it. Marcus Aurelius

MarshallT
Posts: 407

Posted:

For clarification, yes these are common elements.

ElleN
Posts: 1,392

Posted:

Quote:

Posted By MarshallT on 11/28/2024 6:28 AM
For clarification, yes these are common elements.

If they are called only "common elements" (and not say "limited common elements"), then as others suggested, I question whether turning over use of these common elements to others, even for a fee, is a violation of the covenants.

Covenants typically say "common elements" are paid for by all and are supposed to be accessible to all.

But if your board has been doing things in this manner for a long time. Just be aware that any policy you or someone else prepares speaking to exclusive use of a common element by another is a blatant conflict with what the covenants say.

ElleN
Posts: 1,392

Posted:

Quote:

Posted By ElleN on 11/28/2024 8:51 AM

But if your board has been doing things in this manner for a long time.

Change this sentence to "But if your board has been doing things in this manner for a long time, then you all should speak with the HOA attorney and HOA insurer about the risks here. The board should probably seek an amendment to the covenants."

TimB4
Posts: 20,986

Posted:

Usually the terms are:

Common Area (property)
Common Elements (items)
Exclusive Use Common Area (area controlled by COA/HOA but only used by one member - parking spot as example)
Exclusive use common element (some idea but with specific items, balcony, patio as example)

JohnC46
Posts: 14,230

Posted:

I find it strange (and maybe illegal/improper) that an association can and does rent out common areas. That said, if it has been an ongoing procedure and all accept just log the income as HOA Rental Income or whatever as long as you all understand it.

TimB4
Posts: 20,986

Posted:

Quote:

Posted By JohnC46 on 11/28/2024 11:05 PM
That said, if it has been an ongoing procedure and all accept just log the income as HOA Rental Income or whatever as long as you all understand it.

Also, if filing 1120-H form, that income is taxable.

TerriS6
Posts: 3,265

Posted:

How can an association rent out to owners a common area owned by the owners?

KerryL1
Posts: 14,519

Posted:

Hey, Marshall, can you elaborate little on your question? I, for one, truly am interested in the wording in your CC&Rs that allow th HOA to rent out -- if that's the correct phrase -- common areas?

Btw, Tim is Cali, and perhaps other states, there's no such phrase as "common elements," all, including, say, gym equipments and poolside tables, etc., etc. common areas.

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